Africa's top bullion producer AngloGold Ashanti said on February 23 it fell into a loss in the fourth quarter of 2014 because of costs associated with layoffs and restructuring at its key Ghana operation and accounting adjustments. AngloGold posted a fourth-quarter adjusted headline earnings loss of $117 million compared to a profit of $45 million in the same period in 2013 and a profit of $2 million in the previous quarter of 2014.
The company has been restructuring its Obuasi gold mine in Ghana, with plans to mechanise the century-old operation that has not made a profit in a decade.
AngloGold said the fourth-quarter loss was mainly attributable to "$147 million associated with operational and corporate redundancies relating to the Obuasi restructuring, environmental liability resets of $20 million and closure costs of $13 million". AngloGold ceased underground production at Obuasi last November as it started preparations to transform the mine. The company said it was too early to say when production would resume.
"We will move into 2016 with more development. The focus will be on how to get a higher grade, lower cost, profitable operation which is largely mechanised," Chief Executive Srinivasan Venkatakrishnan told Reuters.
The company said its capital expenditure fell to $1.2 billion in the financial year 2014, down 39 percent from the previous year - part of a wider trend in the sector suffering from slumping gold prices. Exploration and evaluation spending was down 44 percent at $144 million.
For 2015, AngloGold forecasts capital expenditure between $1.0 billion and $1.1 billion.